Relevancy and the Internet's sea change

(Once again need to caveat that this is my personal opinion and has nothing to do with eBay's perspective) Safra Rashtchy from Piper Jaffrey had an interesting (but not completely correct) thought on Internet trends which bears noting...

"(There is) increasing fragmentation of internet sites and users' desire to frequent specialized vertical sites, both in commerce and in content and community. This, in our view, is the last stage completing the Web 2.0 evolution which began with the decline of AOL as its value proposition of a walled garden rapidly faded away. We believe the new Web requires new models and those who do not adapt will eventually vanish. This online Darwinism, while in early stages, could entirely change the landscape over the next five years, if existing players remain slow to react."

At some later date I'll comment on my direct opinion of the above. That said, while I concur that the Web is undergoing a sea change which will require new models, I don't agree with Safra's perspective on users.

Specifically, I don't think users have a driving desire to frequent multiple specialized vertical sites. People still have significant limitations on their time, and users will still want to visit their favorite 5-6 sites per week (as they do now). The BIG difference is that in the past those 5-6 sites were focused on maybe a dozen branded destinations. In my humble opinion, that's the most significant shift occuring these days. The favorites are changing dramatically, as driving relevant content has become a focal point for new web sites/services.

Instead of a dozen destinations, we're talking literally hundreds of potential destinations that are making up the new 5-6 favored sites a user goes to an a weekly basis. Looking at traffic patterns of current top Web 2.0 sites, at least a couple hundred have 750K-1MM+ unique users per month. These sites are no longer concerned about crossing the chasm, but already have a deeply specialized cut of the mass market, driving specific relevancy to specific users. Take Dogster as a clear example with 300,000 registered members (and growing), the recently acquired Grouper with 8MM uniques per month and RSS Readers (like Bloglines) aggregating dozens of feeds into one site. Social networks based on age, demographic (college, adult), and individual idiosyncrasies (Goth, Music, etc) only extend this further. Personally I believe each 'relevant' niche will end up with a winner or two, but we're still far from judging who those winners will be. In the end, it's the huge propogation of relevant and free content/services from Web 2.0 sites which is driving this trend toward site disaggregation (all supported by ad revenue).

Every (and I mean every) major destination site needs to adjust and conform to this new model where that site's services are easily integrated to the NEW 5-6 sites now engaged by users, whether that's Bloglines, Dogster, MyYahoo, MySpace, Netvibes, or Youtube. At some point, consolidation will come (making it easier to partner with winners), but until then it's simply too risky to NOT wildly disaggregate and openly distribute online content/services.

Predicting success and failure

With no original content to add, here's a couple of great posts. First from Scott Adams on predicting success. Not sure why he titled the post "Knowing when to quit", since he only marginally covers this topic from his own experience... but still some good nuggets on predicting when something will really take off. Here's an example.

"So if you invent a new type of umbrella, for example, and every person who sees it says “that is clearly better than all other umbrellas on the market” then you have nothing. Walk away. But if someone who barely knows you demands to buy six of them for everyone in his family, and doesn’t first ask the price, and is willing to drive to your house to pick them up, then you might have something. Great ideas catch on immediately, and passionately, at least with the early adopters."

I couple this with a post from YCombinator's Paul Graham on startup mistakes (thanks Jeffrey for the lead). Paul lists 18 mistakes he believes bury potential businesses from succeeding. He saves the most impactful fatal mistake for last - "A Half Hearted Effort". At the multiple start-ups my wife or I have been involved in, building a founding team that 1) trusts each other and 2) are fully committed was tantamount. Unfortunately, we found it hard to find both. Because so many elements of a founding team are ridiculously important (i.e. product development, QA, sales, customer management, etc), if the engineer or rainmaker aren't plugged in, it often doesn't matter how passionate you are on your own... If the second, third or fourth leg of the table doesn't match the others, the platform is set to fall. We would waste 3-9 months looking for, signing, managing and ultimately firing engineers, sales people, and marketers who were bad fits for the sake of expediency. Frankly, it would have been better to screen much harder at the outset... Great hindsight is such a drag ;)

Judysbook shopping?

I wrote a review of Yelp, Judysbook and Insiderpages a few months ago, with Yelp 'winning' the title of local review champ. With that, I was surprised by Judysbook's complete about face. Rather than local store/service reviews, the site is now focused on user-generated 'hot' deals across the web. This includes the now-familiar social network, comment and popularity voting aspects. While it's an interesting space, other sites are far more likely to outduel Judysbook here. In fact, the 69th ranked site per Alexa is a site called Fatwallet which seems to do exactly the same thing. Doh. Even worse, the 22nd ranked site is a little company called Digg whose functionality is directly in this wheelhouse.

Well, you gotta hand it to Judysbook founder/CEO Andy Sack (who has a great blog btw). At least he's got brass...

GooTube and Myspace

Just an observation. (Completely my own btw and not representative of eBay whatsoever ;)) Now that Google has acquired Youtube, I wonder how the MySpace folks feel about their choosing Google as their search partner. In essence, searches on MySpace leveraging Google will probably end up with either 1) video content from Youtube (will Google maintain its Google Video link or focus on Youtube?) or 2) advertising revenue for Google that can be spent to bolster Youtube's reach/advertising/product. What a twisted web weaved these days thanks to "co-opetition".

Thanks Greg Isaacs!

My old boss in eBay's Developers Program, Greg Isaacs, announced today that he was leaving eBay. In response, eBay's stock price rose 2.6%. Greg, you should leave every day :) Seriously, Greg was a great manager and friend.

We're going to miss you bro. Look forward to whipping you in Ping Pong and Go-Carts one day in the near future. Hopefully your next company flag football team actually wins something :( (Greg was 0-3 at Meg Bowls)

Amazon and A9

Looks like Amazon is giving up on some of its search engine dreams. A9 is now being directed to improve Amazon's own site search functionality rather than build a destination site of its own. Not sure why I find this news somewhat disappointing (if unsurprising).

Ultimately, the disintermediation of Internet usage from current top sites is coming from services that aren't focused on web search, but rather providing relevancy to the user whether user-selected or dynamic in nature. Sites like Netvibes, Live.com, Meebo and MySpace are building pretty strong momentum here. When Hitwise reported that 10-12% of incoming Google traffic was being sourced by Myspace, this was just one example of this trend. As top webtops, chat interfaces, blog aggregators and others drive true relevancy to users based on their shared interests, personal networks and like communities, the increasing number of Internet 'starting points' will build beyond current favorite MySpace (and Youtube) alone. Looks like Amazon figured that out and dropped its own attempt at disintermediation. Still, its sad to see innovation cut at the knees.